Breach of Contract

An employment contract is a legal agreement between an employer and their employee. Both employers and employees can be in breach of a contract of employment, so it's important to know what this is and what you should do if either you or your employer breaches your contract.

What is a 'breach of contract'

A breach of  contract happens when either you or your employer breaks one of the terms, for example your employer doesn't pay your wages, or you don't work the agreed hours. Not all the terms of a contract are written down. A breach may be of a verbally agreed term, a written term, or an 'implied' term of a contract.

Breach of contract by your employer

If you think there's been a breach of contract, check the terms of your contract to make sure. If there has, you should try to sort out the problem directly with your employer first of all.


Before taking legal action, you are required to try other ways to sort things out. For example, you might try mediation through the Labour Relations Agency.

Legal action

If you can't sort the problem out with your employer, you can decide to take legal action. Think carefully before taking any legal action against your employer. Ask yourself what you want to achieve and how much it will cost. Remember that you'll only get compensation (called 'damages') if you can prove real financial loss, if for example, your employer doesn't pay your wages. There's no compensation for distress or hurt feelings.

You should also remember that taking legal action might prompt your employer to take out a counter claim against you if they feel they have one.

If you do decide to take legal action, it can either be through an Industrial Tribunal or through a civil court.

Industrial Tribunals

To make a breach of contract claim through an Industrial Tribunal, your employment must have ended. There is also a cap of £25,000 on what a tribunal can award. As well as that, you need to know that if you wish to claim more you cannot first seek £25,000 from a tribunal and then go on to seek the balance from a civil court.

There are restrictions on the type of claim that can be made, for example you cannot make a personal injury claim through the tribunal, and there is a three-month time limit on making a claim.

Unlike civil courts, there are no fees for claims through the Industrial Tribunals and they are often quicker than the civil courts. 

Civil courts

To make a claim while you are still employed you will normally go through the small claims track of the county court or other civil court. There is a longer time limit than for an Industrial Tribunal, but there will normally be court fees to be paid.

Common examples of breaches of contract

Most issues about breaches of contract can be answered by checking the terms of your contract.

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